How Financial Technology is Being Implemented to Help Funding Small Business During Corona Virus

To say that the coronavirus COVID-19 has crippled the US economy (and economies around the world, for that matter) is the understatement of the century.

Small businesses in particular have been hardest hit, with more than 24% of all small businesses in the US having – at least temporarily – up their doors.

40% that haven’t shuttered their businesses already expect that they will have to do so within the next month, and 43% of small businesses report that they believe they are six months away from a permanent shutdown if the economy isn’t opened up ASAP.

Even in the face of these dire circumstances, though, small business owners and entrepreneurs remain generally quite positive about the future of business in America.

57% of small business owners report feeling positive about their business prospects, 23% believe they’ll hire more than five people in the next year, and 46% of all small business owners anticipate it’ll take between three and six months for business in the US to “get back to normal” after the country is opened back up.

The government has been moving decisively (for the most part) and working in bipartisan fashion to find a way to protect American citizens from a viral attack that has slammed the brakes on our economy.

The Paycheck Protection Program (PPP) funding solutions establish as a part of the Coronavirus Aid Relief and Economic Securities Act (CARES Act) was a big piece of this puzzle. On the day that the program went live, only two major traditional banks and financiers were rolling out applications and approvals – Bank of America and J.P. Morgan Chase – resulting in a slower rollout than expected.

This has led to financial technology companies all over the country rushing to find new and innovative ways to help small business owners best take advantage of this program. They’ve been a huge part of stabilizing the economic freefall that’s been devastating the small business world for months.

Here are a couple of ways that some of the best nontraditional and alternative lending platforms, as well as other financial technology companies, are helping small business owners take advantage of everything that the PPP funding has to offer.

PayPal

It should come as no surprise to anyone that one of the largest financial technology companies on the planet (as well as one of the oldest and most respected) would be one of the first to dive into the fray and help small business owners leverage PPP funding.

The big push from PayPal has obviously been focused on those that already have business or merchant accounts with the online payment processor, but they have opened up there PPP solutions to those that do not have PayPal accounts already recently – and are accepting non-merchants through their online portal today.

Intuit QuickBooks

QuickBooks is another major player in the financial technology world, and a brand almost all small business owners are familiar with. Perhaps most well-known for their accounting and payroll software, the transition for this company to begin offering tools to accept PPP funding applications was incredibly smooth.

Small business owners that have already taken advantage of payroll or accounting software through QuickBooks (as well as those that leveraged TurboTax tax filing software) are able to apply for PPP funding 100% free of charge and may be able to receive PPP loans directly from QuickBooks Capital as well.

Bottomline Technologies

This financial technology company has focused almost exclusively on Accounts Payable solutions, but recently they made the announcement that they were going to begin adapting their own Account Opening Technology to allow other financial institutions to streamline the PPP loan origination process.

This organization has also opened up their platform to all small business owners that want to apply for PPP lending, helping to fast-track the application and approval process while a lot of traditional banks and alternative lending offices remain closed or have limited hours and accessibility.

Kabbage Funding

A marketplace lending organization, it didn’t take very long at all after the announcement of the CARES Act for Kabbage to unveil a pre-application service intended for small business owners looking to capitalize on SBA lending through the PPP platform.

The entire solution from Funding Circle has been engineered to dramatically simplify and speed up the process of applying for PPP loans from other lending institutions and services right now.

At the end of the day, the take away here is that the financial technology community and the alternative lending industry are working together to find ways to better serve small business owners in their time of need.

These kinds of solutions and services simply didn’t exist during the Great Recession of the middle 2000s. It’s nice to see such relatively new solutions being innovated so rapidly to help small business owners overcome this economic collapse no one could have foreseen.